Pet Age Magazine reports the following pet business retail statistics for their annual Retailer Report which came out in January of 2011 and covers the years 2009 through 2010. Here were some of the highlights gathered from the 242 retailers who responded, with a margin of error of 6.3%:
- 41% of pet retailers responding to the survey have been in business more than 10 years
- 3% of respondents have been in business one year or less
- Average time in business: 12 years
- 30% of pet retailers are sole proprietorships
30% of pet retailers are LLCs
- 28% are S corps
- 8% are C-corps
- 4% are partnerships
- 53% of pet retailers are located in an urban environment like city or suburb
- 83% of pet retailers have a web site
HAVE BOUTIQUES PEAKED?
The age of the pet boutique as we know it is over, according to the survey, thanks in large part to the economy. No surprise, really, that the days of selling $100 dog dresses has seen it's day.
But while the stats showed that 18% of pet retailers considered themselves a pet boutique in 2005 only 9% did in 2009, the boutiques that have survived are evolving to focus less on fashion and more on pet health with the more successful boutiques positioning themselves as experts who can advise their customers about health and wellness issues and less about $50 dog collars.
Other hightlights...
CONTRADICTIONS IN SERVICES
The Pet Age survey identified some contradictory trends when it comes to offering pet services to augment product sales.
- While 70% of respondents are offering at least one pet service (such as dog washing), up from 62% in 2008, they accounted for only 14% of dollar volume compared to 19% in 2008
- Margins on pet services increased significantly from 69% in 2008 to 108% in 2009
- Most popular service was self-service dog washes, up from 12% in 2008 to 22% in 2009
- Doggie daycare at pet retailer locations dropped from 18% in 2008 to 12% in 2009
Probably means that while pet consumers are more careful with their spending, they're still seeking out services of value and retailers are graviating toward those services that are less expensive to operate with higher profit margins. Self-service dog washes vs the labor-intensive doggie daycare service is a financial no-brainer.
WHERE PET STORES MAKE THEIR MONEY
While dog food sales and dog supplies remained the category leader, the live animal category was up 4% with reptiles and amphibians leading the way
The TOP 10
FAVORITE FORMS OF ADVERTISING
Average spent on advertising, $8,797 in 2009, up from $7,938 in 2008.
- Referral/word of mouth 32%
- Internet/Email 22%
- Newspaper 14%
- Direct Mail 7%
- Radio 7%
- TV/Cable 5%
- Magazine 4%
- Phone directories/Yellow Pages 3%
- Other including events 1%
AVERAGE STORE SIZES
- 3,417 sq. feet retail space
- 50% 2,000 sq feet or less
- 29% have 2,000 - 3999 sq feet
- 14% have 4,000 - 7,999 sq feet
- 7% have 8,000 square feet or more
SUMMARY
While most pet retailers cited the economy as their number 1 challenge in the survey, the issue that rated number 2, which didn't even make the list last year, was finding and keeping good employees.
Many pet retailers find themselves in a Catch 22 of sorts, reducing salaries and benefits because business is off but then losing business because they can't retain good employees. I find that very surprising considering the high unemployment rate but see this as a tremendous oportunity for retailers to attract good, reliable employees with a little creativity. Things like flexible hours and bonuses based on performance can make the difference as well as paying hiring bonuses to existing employees for recommending potential hires who get hired and remain with the business for at least one year.
OTHER HIGHLIGHTS
- 30% of retailers are 55 or older, up from 25% in 2008
- 25% of pet retailers reported sales increases of 10 - 24% in 2009
- 5% reported sales declines of 25% or more
- Dog food was the product attributing the greatest dollar volume to the business
- Average gross dollar volume in 2009 was $1,575,657, almost triple the 2008 average
- Average customer transaction in 2009 was $82.24
- Number of retailers offering employee benefits in 2009 dropped 13%
